Don’t knock it - Why you should never knock the Competition
David Shalam, Founder and Creative Director, Studio 2br
Some startups hope to cause a stir with their advertising. But knocking the competition is a high-risk strategy best left to mature brands.
Fintechs are shaking up the financial services industry with their fresh ideas and bold attitudes. In fact, so many new startups are emerging that it seems like there are no gaps left in the market. That’s beginning to present business and branding challenges for more recent startups as they seek their niche.
How do you stand out from the crowd?
The crowded fintech scene makes it more difficult for new digital transaction banking providers to stand out, which may be what led fintech startup Viola Black to choose such an aggressive strategy for its current advertising campaign.
Viola Black is running ads with the headline of “Move over, Monzo.” Much as we like to see brands have some attitude, we’re not fans of this message. It’s never good business to give free advertising to a competitor and these ads could well send more customers Monzo’s way. It’s also damaging for Viola Black to appear to be an imitator, especially in a sector like fintech that’s all about innovation.
Viola Black may intend to show confidence by comparing itself to a better-known brand, but to some eyes it might look like it has an inferiority complex instead. We’d prefer to see Viola Black communicate a strong proposition of its own, not look to hitch a ride on a competitor’s success. There’s also a risk that this brand strategy will do nothing to increase the size of Viola Black’s market. Since the target appears to be customers of Monzo rather than first time users of digital banking, it may even shrink it.
This is what can happen when a startup does not have a clear identity. Founders can be in a hurry to get to market, but it’s better for the long run to get the proposition and narrative right from the outset. Attack advertising may create some temporary disturbance and even make headlines, but we think it’s a big risk for startups to use knocking copy. It’s really only well-known brands that can get away with it.
Pepsi and Coca-Cola and Apple and Samsung are examples of big names that have played out rivalries through advertising that plays on the shortcomings of the competition. Their use of wit is one factor that allows these brands to go where most startups can’t. The tone of their ads is an expression of the self-confidence that comes from selling millions of units to consumers around the world every year.
These brands deal in solid everyday products rather than invisible financial technology. They also operate in mature mainstream markets where consumer choice is influenced by marginal differences based on personal habits and taste. Consumers know them well enough to enjoy the show. No-one feels threatened. Few startups have these advantages.
Other consumer brands prove that it’s possible to be assertive without picking a fight. VW ran a memorable campaign that had drivers of other makes of car comparing their vehicles to a Golf. Vauxhall has a current campaign that shows how features that other carmakers commonly charge for are included in the price of its Griffin model.
VW and Vauxhall avoid any controversy by making general reference to other brands without getting specific. This is a strategy that startups can adopt. It’s much safer to knock common practice than individual practitioners. For Viola Black, the technological limitations, cumbersome ways and high fees of mainstream banks as a whole could be more productive targets than other startups.
Our advice to any brand, startup or household name, is that it’s always better to be constructive. At the heart of every longstanding brand is likeability, because consumers are still people. We gravitate to those we like. We’d rather hear what’s good. So if you want to maximise the brand appeal of your startup, don’t be distracted by what the competition is doing. Take pride in who you are, get your own story straight and tell it in the most positive way.